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Housing
Today the Case/Shiller housing price data came out and it showed prices up nearly 20% YoY. Brent crude oil touched $80 per barrel and is on course for its best month since February. Treasury yields have risen quite dramatically over the last week, with the 10-year now above 1.5%, the highest since June.  Natural gas...
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I came across a prescient article discussing the dangers of mortgage REIT’s, particularly as interest rates begin climbing.  These companies’ use huge amounts of leverage to buy mortgage backed securities, and because they pay out the vast majority of net income as a dividend to shareholders’, the companies’ benefit from better tax treatment on the...
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Finally some snail steps towards progress on defining what a “qualified mortgage” is.  There is very little mortgage origination going on, which people don’t fully comprehend because it is overshadowed by the enormous amount of refinancing.  It is essential that there are clear and strong regulations on mortgages but it is really important for these...
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One of my very favorite investors Wilbur Ross was on Fox Business News discussing housing, politics, and business.  I think he is right on just about everything, and his comments about the high likelihood of a recession if we endure the fiscal cliff are right on.  Ross is a perfect example of a patient and...
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We have talked about the vulnerability of the Australian economy due to its exposure to heavy mining materials before, as we expect Chinese demand to slow down.  There are significant issues with the Australian economy due to over-inflated housing prices, and an extremely strong currency which crimps exports.  The decade long mining boom has propelled...
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Today’s housing news contributed to the market route but I don’t think the number were as bad as some people think.  Sales of existing homes were still up 9.6% from last year, and although they were down sequentially, inventories are low limiting sales opportunities.  It is going to be a tough slog especially with all...
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The substantial decline in real estate prices paired with increases in rental prices, have made buying a home cheaper in many cases than renting.  This is a huge factor in our investment thesis that real estate has hit the bottom.  With rates so low buying a house makes all of the sense in the world,...
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Ken Heebner is a momentum investor which I can’t really relate to, but as far as making macroeconomic calls he has a strong history.  His points on the housing market are absolutely correct.  There is going to be a tremendous amount of money made on the recovery, and just as people were to bullish on...
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KB Home (KBH) reported disappointing earnings last week.  The company attributed much of the blame to buyers struggling to get mortgages.  While I do think KBH is actually one of the more reasonably priced home builder’s,  I don’t think that this industry is the best way to play the rebound in housing.  The reason for...
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Further evidence of the improving economy is seen by the index of home builders confidence which has reached a five year high.  Housing inventory is going down and prices have been depressed due to the high rate of distressed sales.  While consensus is that the housing recovery will take some time, I believe that there...
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